With a domestic leasehold property in Merton, you are actually purchasing an entitlement to live in a property for a prescribed time frame. These days flat leases are usually granted for 99 years or 125. Many leasehold owners become complacent as this seems like a long period of time, you may think about a lease extension sooner rather than later. Accepted thinking is that the shorter the lease is the cost of extending the lease increases markedly notably once there are fewer than 80 years left. Anyone in Merton with a lease approaching 81 years unexpired should seriously think of extending it sooner rather than later. Once the lease term has fewer than 80 years outstanding, under the relevant Act the freeholder can calculate and demand a larger premium, assessed on a technical multiplication, known as “marriage value” which is payable.
It is conventional wisdom that a property with over one hundred years remaining is worth roughly the same as a freehold. Where an additional ninety years added to all but the shortest lease, the residence will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Godiva Mortgages | A minimum of 70 years unexpired lease at completion for all scheme types apart from Lifetime Mortgages (Equity Release), which require a minimum unexpired term of 80 years at completion. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Irrespective of whether you are a tenant or a freeholder in Merton,the lease extension lawyers that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Merton valuers.
Tommy owned a conversion apartment in Merton on the market with a lease of a few days over fifty eight years outstanding. Tommy on an informal basis spoke with his freeholder being a well known local-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to grant an extension taking the lease to 125 years on the basis of a new rent at the outset set at £200 per annum and increase every 25 years thereafter. No ground rent would be payable on a lease extension were Tommy to exercise his statutory right. Tommy obtained expert legal guidance and secured satisfactory resolution informally and readily saleable.
Mr F Norbert owned a ground floor apartment in Merton in February 2002. The question was if we could estimate the price could be to extend the lease by a further 90 years. Comparable homes in Merton with 100 year plus lease were valued around £255,000. The average amount of ground rent was £50 collected annually. The lease finished on 13 July 2096. Taking into account 71 years as a residual term we estimated the compensation to the landlord for the lease extension to be between £9,500 and £11,000 plus costs.
Last year we were called by Mr Jackson Martinez , who moved into a one bedroom flat in Merton in April 1999. The question was if we could estimate the price could be to extend the lease by ninety years. Comparable flats in Merton with 100 year plus lease were valued around £249,200. The average amount of ground rent was £60 invoiced every twelve months. The lease ran out in 2076. Taking into account 51 years left we estimated the premium to the landlord for the lease extension to be between £42,800 and £49,400 exclusive of expenses.